Finding a new home can be very exciting but also very challenging. When making decisions regarding your new home, many buyers make compromises between what they want and what they need. Working with your Accredited Buyers Representative (ABR) to help sort out your options and prioritizing your preferences will go a long way toward meeting your goal of finding the perfect home for you.
Following is a list of Basic Features to consider:
* Basic home feature, a single family, detached, townhouse, vacation home.
* Desired number of bedrooms and baths.
* Home layout.
* High priority features such as waterfront owned or shared.
* Special use rooms such as office or exercise room.
* Storage spaces
* Garage, parking spaces.
Other Home Preferences:
* Age and style of home.
* Importance of energy efficiency or green features.
* Commuting distances.
* Proximity to desirable features such as recreation, schools.
* Size and shape.
* Home orientation.
Life at Home
* How will all members of your household impact housing preferences?
* Proximity to neighbors.
* Homeowner Association fees.
* Property taxes.
* Insurance including flood insurance.
* How much do you want to invest in a home beyond the purchase price either financially or in sweat equity?
* Are you able to consider other neighborhoods that provide better affordability?
* Does the length of time that you plan to own a home impact the type of home that you will buy?
Supplying the answers to some of these questions will help you to work successfully with your ABR Realtor.
It is a perfect time to be a buyer. Today’s market offers many choices and interest rates are at an all time low. Maybe you have started looking on line and called a few Realtors for information. Perhaps you have even looked at a few properties with a Realtor. You may have been asked by a Realtor to sign a buyer’s agreement. What is this form? Why should you sign it?
A Buyers Representation Agreement is a legal document that formalizes your working relationship with a particular buyer’s representative, detailing what services you are entitled to and what your buyer’s rep expects from you in return. While the language used in the document is formal, homebuyers should view it as an important and helpful tool for clarifying expectations, developing mutual loyalty, and most importantly, elevating the services that you will receive.
By signing a buyer’s agreement you can expect to receive a higher level of service. When you enter into an agreement you are no longer a customer (receiving limited service) but become a client (receiving the highest level of service).
You get more without paying more. In almost every case, home sellers have already agreed to pay a buyer’s agent’s commission. While buyers rarely pay real estate commissions, this is an important detail you will want to discuss with your buyer’s rep and clarify in their representation agreement.
A Buyer’s Representation Agreement clarifies expectations. Agency relationships are based on mutual consent. While most representation agreements specify a time period, they can be terminated early if both parties consent.
When you and your buyer’s rep work together within a formalized agency relationship, you have created a team dedicated to helping you achieve the best possible home-buying experience.
It is a sad fact of the real estate market that there are many pre-foreclosures, foreclosures and short sales out there to choose from. While noone wants to see a homeowner lose their home, these properties offer unique opportunities for buyers.
Questions that you need to ask yourself before pursuing these types of properties:
1. Are you flexible on timing? Can you make a quick decision and accomodate months of possible delay?
2. Is your purchase contingent on selling your home? Banks want a clean offer with few or no contingencies.
3. Have you already secured financing? If you have, the bank considers you a strong and serious buyer that has done the initial footwork required to purchase a home.
4. Do you have resources to rehab and repair a property, if needed?
5. If you are buying a property for investment purposes, what is your action plan? Rent or re-sell or inhabit the property yourself?
Foreclosure is a process that can offer buying opportunities at each stage.
Stage 1- Pre-foreclosure sale is a period of time that begins with the initial mortgage default and ends when the property is sold.
Stage2- Foreclosure sale is when the property is auctioned off to the highest bidder that also meets the terms of the sale.
Stage 3- REO (Real Estate Owned) is real estate that did not sell through foreclosure and is transferred to the lender.
What is a short sale?
This is a situation in which the seller owes more on their loan than a sale on their property will produce, and they are unwilling or unable to make up the difference at closing. The seller may or may not be in foreclosure. Banks may consider a short sale to a new buyer. Foreclosures are very expensive for banks that need to hire attorneys, property managers and other professionals. Accepting a short sale enables the bank to cut their losses.
Your ABR buyers representative can help you in this process, especially if your Realtor also has the training and experience in these types of sales indicated by an SFR designation.
In today’s stricter lending environment, the processing of a mortgage application is more complex than ever because of the additional steps required by those in the financing business. As a smart buyer, contacting a mortgage lender before shopping will ensure a smoother transaction. By planning ahead you will be in a much better position to negotiate and purchase, avoiding any unpleasant mortgage surprises.
Following these steps will help:
1. EVALUATE AFFORDABILITY. The two most important of which are your monthly mortgage payment and your total debt load relative to your gross income. It is also important to consider additional expenses such as property taxes, insurance, maintenance, association fees and utilities.
2. DISCUSS YOUR OPTIONS. The type of mortgage depends upon your personal, financial and future plans. For example, if your down payment is not large enough to qualify for a conventional loan, perhaps seeking an FHA mortgage or another program offered at the national level would work better. Mortgage programs are always changing so ask your ABR about current options.
3. INTERVIEW LENDERS. Your ABR can recommend several based on past homebuyers’ experiences. While rates and fees are competitive between lenders, other factors may be important. Level of service and how well they have executed transactions in the past and their familiarty with certain mortgage programs over others’.
4 GET PRE-APPROVED. Completing a mortgage application with one or more lenders will help to confirm whether or not to modify your plans. Your pre-approval does not guarantee that you have a mortgage, because it is contingent on the lender receiving full documentation from you. Getting pre-approved is an important first step and puts you in a better negotiating position with sellers.
5. COMMIT TO A LENDER. As soon as you are under contract to purchase a home, commit to working with one lender to complete your mortgage application. You will probably be charged a fee at this point showing that you are serious about a working partnership with them and submitting the required paperwork as quickly as possible.
Following these five steps will improve your outcome of getting a mortgage. Your ABR can provide more detailed information on each step in the process.
Clee Duncan ABR ( Accredited Buyers Resource)